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Old 07-04-2017, 03:14 PM   #26
rafiki
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Re: Nows the time to buy oil?

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Nitrogen fertilizers or copper are better commodity's to bet on.
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Old 07-04-2017, 03:55 PM   #27
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Re: Nows the time to buy oil?

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Or coal or natural gas or nuclear, which makes up the bulk of power generation by far (Oil is insignificant as a power source).

The tires/safety are the limitation on the fastest end, not the engine. And electric cars (as of now) are accelerating far heavier bodies.

The point is that electric makes possible a noiseless, ultra low running cost V8 engine in even the cheapest passenger car, for no extra cost.

As for oil usage, the ration of car:truck/heavy vehicle oil usage is about 120:40. Add another 15 for jet fuel.

And yes, trucks will be replaced and become all electric as well. <10 years until electric becomes superior there as well in terms of cost to build, maintenance, and running cost. Hybrids will be viable before that, and dramatically reduce consumption.

You'll be left with 5-10% of transportation running on oil, including planes.
That's just a number you pulled out of your ass.
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Old 07-04-2017, 03:55 PM   #28
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Re: Nows the time to buy oil?

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peak-demand is still years, i'd say atleast 2 or 3 decades, away.
sure EV's will be cheaper and better, i guess within the next decade, but it's gonna take another 20-30 years to replace most of gasoline powered transportation. my guess would be another ~20years of 1-2% demand growth and maybe another 10 years of steady demand after that before any singnificant downturn, maybe around 2050.

what this means for oil prices is up to price action and resulting capex. the longer we stay below or around 50$ the higher the chance we see above 100$ again and vice versa.
They don't have to completely replace gas cars to have a huge impact on the demand for gas. What happens when half of vehicles on the road are evs?


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Because it has a dozen times?
There was a prolonged spike from 75-85, and then from 05-15. At pretty much every other point in history it's been below $50/barrel.

There're tons of examples where resources/stocks/currencies have fluctuated wildly and then settled in at significantly lower/higher prices.

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I thought this too but then I thought about it again and it's not the case. Even for light transportation vehicles EV will not take over the whole market. EV won't probably ever be as powerful as gas for one, so in certain sections of that market gas will hold on. Also, the trucking industry will likely remain gas, so will pickup trucks and other transport. Airliners will never be electric. Heavy machinery will remain gas/diesel. Marine will always be gas/diesel. Housing will remain natural gas, Tesla shingles might take a small portion of the market in democrat states.

Only the car market will see a loss to electric, and it won't be as much as you think, and it's not close either. 5-10 years minimum before they start to make significant gains.
If it takes 5-10 years for EVs to cross 50% of passenger vehicles sales, that probably means within 20 they'll be half the cars on the road and passenger vehicles account for almost half of oil consumption. And do you really think that if it becomes cost effective for passenger vehicles that NONE of the industrial vehicles will go electric? It's hard to imagine oil consumption dropping any less than 20% within 20 years purely based on the economics of passenger vehicles.

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Not only that, but you need electricity to even charge battery powered cars. How do you make electricity? By burning oil.
And what percentage of electricity is generated by burning of oil? half of a percent? The reason is because it's not cost effective.
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Old 07-04-2017, 04:00 PM   #29
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Re: Nows the time to buy oil?

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If it takes 5-10 years for EVs to cross 50% of passenger vehicles sales, that probably means within 20 they'll be half the cars on the road and passenger vehicles account for almost half of oil consumption. And do you really think that if it becomes cost effective for passenger vehicles that NONE of the industrial vehicles will go electric?
Industrial vehicles won't go electric because electric has diminishing torque, and they probably won't ever make an efficient battery operated semi-truck or heavy machine. Electric works for quick passenger vehicles but I doubt it can work for hauling.

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And what percentage of electricity is generated by burning of oil? half of a percent? The reason is because it's not cost effective.
Oil itself way more than 1/2%. Almost all marine uses heavy oil for example. Gasoline and aero-fuel is rendered from crude. Many power plants burn oil or light oil. Burning hydrocarbons is like 95%. It all comes out of the wells the same...mixed together. The burning of hydrocarbons in one form of another is required to generate the vast majority of the worlds electricity. So even this theory that electric cars will somehow save the world from pollution is nonsense. Electric cars coupled with nuclear might, but the footprint from battery factories and charging stations will offset most of the pollution saved from cars going to electric.
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Old 07-04-2017, 04:01 PM   #30
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Re: Nows the time to buy oil?

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Oil sands break even prices are $65-85. Fracking is just punching holes upstream so it's gotta be profitable for way way lower.
Source?

Last I read Suncor who is the biggest player in the Canadian oilsands has costs down to ~24$ a barrel.
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Old 07-04-2017, 04:32 PM   #31
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Re: Nows the time to buy oil?

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Source?

Last I read Suncor who is the biggest player in the Canadian oilsands has costs down to ~24$ a barrel.
Nowhere near that low on average. Suncor is the biggest company in Alberta, but it's not the only one, and I believe they just started with new technology that brings their costs even lower.

~$50 for SAGD, $70 for standalone mine:

http://www.oilsandsmagazine.com/news...ine-since-2015

Syncrude $57

http://ca.reuters.com/article/busine...0QO25I20150819
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Old 07-04-2017, 05:54 PM   #32
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Re: Nows the time to buy oil?

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Nowhere near that low on average. Suncor is the biggest company in Alberta, but it's not the only one, and I believe they just started with new technology that brings their costs even lower.

~$50 for SAGD, $70 for standalone mine:

http://www.oilsandsmagazine.com/news...ine-since-2015

Syncrude $57

http://ca.reuters.com/article/busine...0QO25I20150819
I work at a SAG-D facility, we are definitely below 50$, last I heard it was ~30$ with plenty of cost cutting and projects to become more efficient (http://www.cenovus.com/technology/esp.html).

Suncor owns Syncrude:

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Our oil sands costs were just C$22 to C$55 per barrel and remember that's Canadian dollar. So, in U.S. dollars terms less than $17 per barrel. So, our cash costs were 7% lower than the second quarter of last year and this was achieved while absorbing a 46% increase in natural gas costs over the year.
https://www.google.ca/amp/s/seekinga...all-transcript
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Old 07-04-2017, 06:04 PM   #33
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Re: Nows the time to buy oil?

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As for oil usage, the ration of car:truck/heavy vehicle oil usage is about 120:40. Add another 15 for jet fuel.
You'll be left with 5-10% of transportation running on oil, including planes.
That's just a number you pulled out of your ass.
No. The ratio of car:truck:jet is 24:8:3. The 24 and the 8 are going to be completely electric because at a certain energy density - about a decade away - battery models become very superior in every way, such that producing ICE no longer makes sense. Which leaves the planes. The only new items which run on oil will be planes and remote equipment and ultra heavy machinery like boats. Apart from planes, the rest are close to meaningless in global oil usage.

Global oil usage a percentage of all transportation, in newly produced items, will be <10% once it's all done.

Oil as more than a tiny minority transportation fuel has a limited lifespan. The exact dates of when the mass transfer begins and gasoline/diesel usage starts falling off a cliff, is hard to estimate for a number of reasons. But it's something between 7 and 20 years from now. Electric vehicle sales are already closing in on a million/year and growing exponentially. And they've yet to reach cost parity. Once they do, it'll be an explosion.
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Old 07-04-2017, 06:28 PM   #34
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Re: Nows the time to buy oil?

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They don't have to completely replace gas cars to have a huge impact on the demand for gas. What happens when half of vehicles on the road are evs?
total number of cars on the road are projected to double until 2040, most of it from china, india and other developing countries. in most of them (read: except chinese cities) there is little to no infrastructure for EVs, nor do i expect the governments to care (most of them don't even have stable electricity for everyone). so even if you get to 50% EVs by 2040 (which, i think, sounds like a high number, higher in western countries, a lot lower in the developing world) the number of ICEs on the road will be about the same as today (which is around the breakeven timeframe I projected). from there we might be flat on oil demand for a few years before it turns down.

/tbh i think 50% worldwide EV share by 2040 is pretty optimistic if i think about it. people are slow to adapt and a car is a significant investment for most (esp. in 3rd world countries). i just have to think about the amount of 20y old cars i see today.

Last edited by BooLoo; 07-04-2017 at 06:48 PM.
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Old 07-06-2017, 04:13 AM   #35
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Re: Nows the time to buy oil?

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Industrial vehicles won't go electric because electric has diminishing torque, and they probably won't ever make an efficient battery operated semi-truck or heavy machine. Electric works for quick passenger vehicles but I doubt it can work for hauling.
I don't know why you'd think it would never happen and i have no background in engineering to take a strong position to the contrary, but if hybrid technology reduces large companies fuel consumption costs by even a little bit they'll be on board even faster than the average american driver.

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Oil itself way more than 1/2%. Almost all marine uses heavy oil for example. Gasoline and aero-fuel is rendered from crude. Many power plants burn oil or light oil. Burning hydrocarbons is like 95%. It all comes out of the wells the same...mixed together. The burning of hydrocarbons in one form of another is required to generate the vast majority of the worlds electricity. So even this theory that electric cars will somehow save the world from pollution is nonsense. Electric cars coupled with nuclear might, but the footprint from battery factories and charging stations will offset most of the pollution saved from cars going to electric.
https://en.wikipedia.org/wiki/Electr..._United_States

suggests that oil is .7%.

Quote:
/tbh i think 50% worldwide EV share by 2040 is pretty optimistic if i think about it. people are slow to adapt and a car is a significant investment for most (esp. in 3rd world countries). i just have to think about the amount of 20y old cars i see today.
[/quote]

It can't be much more than 5% of cars on the road (that get normal mileage) that're over 20 years, and if costs continue to drop, these misers will be the same ones who buy a used electric 10 years down the road to save on fuel costs. This is true for poor people in the developing world too. They won't be buying new, but there is a decent chance they'll switch over before 2040.

And I don't think many people are so scared of change that they'd overlook EVs if/when they're noticeably cheaper - it all depends on how fast costs go down.
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Old 07-06-2017, 06:16 AM   #36
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Re: Nows the time to buy oil?

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I don't know why you'd think it would never happen and i have no background in engineering to take a strong position to the contrary, but if hybrid technology reduces large companies fuel consumption costs by even a little bit they'll be on board even faster than the average american driver.



https://en.wikipedia.org/wiki/Electr..._United_States

suggests that oil is .7%.
Yes, but a lot of natural gasoline is refined from crude, so that should be included in the number for 'oil' as well. Also that's just the electricity generation, it doesn't speak to marine craft, aircraft, or heavy machinery, all of which also use fuel refined from crude. Fuel cost isn't a particular problem for anyone right now. Electric motors produce instantaneous torque, but it diminishes with rpm, and it diminishes with motor size as well due to friction, windage and copper losses etc. Electric motors haven't changed much in the past 50 years, it's all in the wiring. I don't think they will ever replace fuel in cases where a lot of constant power, or power over a long time is needed (which is one of the drawbacks of battery).

I readily admit they will take a certain share of the car market, but to think some parts of even the car market won't continue to use gas is just silly.

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Old 07-06-2017, 09:13 AM   #37
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Re: Nows the time to buy oil?

TS simultaneously thinks battery powered vehicle will be superior in every way within a decade and the leader in EV has no chance of meeting even 10% of its projections.
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Old 07-06-2017, 09:16 AM   #38
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Re: Nows the time to buy oil?

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TS simultaneously thinks battery powered vehicle will be superior in every way within a decade and the leader in EV has no chance of meeting even 10% of its projections.
Yes. There is zero inconsistency in those positions. Because an EV is just a battery and electric motor slapped on the entire rest of the car. The battery pack and electric motor are the easiest things to make and will be essentially commodities soon.

Tesla = the only one willing to lose billions of dollars putting not-ready batteries in sports car. Other car makers will enter rapidly and at scale soon as batteries become viable for mass market consumption.

Tesla = utterly crushed in the entire rest of the car

Why is this difficult to grasp?

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Old 07-06-2017, 09:18 AM   #39
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Re: Nows the time to buy oil?

Tesla is crushing in at least one rather significant way: its name is synonymous with fast EVs.
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Old 07-06-2017, 11:47 AM   #40
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Re: Nows the time to buy oil?

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I thought this too but then I thought about it again and it's not the case. Even for light transportation vehicles EV will not take over the whole market. EV won't probably ever be as powerful as gas for one, so in certain sections of that market gas will hold on. Also, the trucking industry will likely remain gas, so will pickup trucks and other transport. Airliners will never be electric. Heavy machinery will remain gas/diesel. Marine will always be gas/diesel. Housing will remain natural gas, Tesla shingles might take a small portion of the market in democrat states.

Only the car market will see a loss to electric, and it won't be as much as you think, and it's not close either. 5-10 years minimum before they start to make significant gains.
Not as far off as you think:
"Volvo Cars on Wednesday became the first mainstream automaker to sound the death knell of the internal combustion engine, saying that all the models it introduces starting in 2019 will be either hybrids or powered solely by batteries."

https://www.nytimes.com/2017/07/05/b...ctric-car.html
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Old 07-06-2017, 03:55 PM   #41
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Re: Nows the time to buy oil?

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Yes. There is zero inconsistency in those positions. Because an EV is just a battery and electric motor slapped on the entire rest of the car. The battery pack and electric motor are the easiest things to make and will be essentially commodities soon.

Tesla = the only one willing to lose billions of dollars putting not-ready batteries in sports car. Other car makers will enter rapidly and at scale soon as batteries become viable for mass market consumption.

Tesla = utterly crushed in the entire rest of the car

Why is this difficult to grasp?
The bottleneck is the batteries and always has been which is why he's building that superfactory in nevada.
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Old 07-06-2017, 03:55 PM   #42
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Re: Nows the time to buy oil?

Battery availability is not a bottleneck, in any way. Battery energy density is, but "superfactory" (aka just a factory) won't improve that at all. It's all nonsense.
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Old 07-06-2017, 03:58 PM   #43
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Re: Nows the time to buy oil?

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Battery availability is not a bottleneck, in any way. Battery energy density is, but "superfactory" (aka just a factory) won't improve that at all. It's all nonsense.
Why is he building the biggest battery factory in the world then? Elon Musk himself has said it's because there isn't a big enough supply of batteries.
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Old 07-06-2017, 04:01 PM   #44
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Re: Nows the time to buy oil?

Because he's a moron and megalomaniac who wants to vertically integrate everything. He's building his own car seats too - is that because there isn't a big enough supply of car seats?

Ignore everything Elon Musk says, the guy is as self-interested and prone to lying as Trump. He likes to put himself at the center of everything and be viewed as indispensable visionary, but the truth is he's irrelevant to what will happen with EVs.

Battery factories worth billions are popping all over Asia like mushrooms to fill this market. There's no supply problem at all. Once energy density is sufficient to be competitive with ICE, you'll see an explosion of growth here.

It's not hard to build a battery factory. Short lead time, no great complexities. Far far easier than say a chip factory or an OLED factory.
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Old 07-06-2017, 04:05 PM   #45
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Re: Nows the time to buy oil?

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Because he's a moron and megalomaniac who wants to vertically integrate everything. He's building his own car seats too - is that because there isn't a big enough supply of car seats?

Ignore everything Elon Musk says, the guy is as self-interested and prone to lying as Trump. He likes to put himself at the center of everything and be viewed as indispensable visionary, but the truth is he's irrelevant to what will happen with EVs.

Battery factories worth billions are popping all over Asia like mushrooms to fill this market. There's no supply problem at all. Once energy density is sufficient to be competitive with ICE, you'll see an explosion of growth here.

It's not hard to build a battery factory. Short lead time, no great complexities. Far far easier than say a chip factory or an OLED factory.
You sure like to argue...
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Old 07-06-2017, 04:07 PM   #46
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Re: Nows the time to buy oil?

How's long oil going? Brutal few days, although I guess that's good if you want to get long.

Have you changed your view on anything with what the experts in the thread have said about production costs?
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Old 07-06-2017, 04:11 PM   #47
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Re: Nows the time to buy oil?

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How's long oil going? Brutal few days, although I guess that's good if you want to get long.

Have you changed your view on anything with what the experts in the thread have said about production costs?
Here we go, a personal attack. You're now blocked for being a generally dislikeable cretin.
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Old 07-06-2017, 04:14 PM   #48
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Re: Nows the time to buy oil?

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Here we go, a personal attack. You're now blocked for being a generally dislikeable cretin.
I may be dislikable but I'm certainly not a cretin.

Also, not a personal attack at all. Read what I wrote again, there is nothing personal in that whatsoever. I was changing the topic to bring it back to the thread. "Cretin" however is certainly a personal attack.

That you took it as an insult shows you must be really wedded to your theses. That's a horrible quality in an investor. Got to burn that out of yourself. Being rational is all that matters, and that involves changing your mind.
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Old 07-06-2017, 07:30 PM   #49
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Re: Nows the time to buy oil?

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How's long oil going? Brutal few days, although I guess that's good if you want to get long.

Have you changed your view on anything with what the experts in the thread have said about production costs?
Not the best day for Tesla either..
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Old 07-07-2017, 11:35 PM   #50
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Re: Nows the time to buy oil?

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I may be dislikable but I'm certainly not a cretin.

Also, not a personal attack at all. Read what I wrote again, there is nothing personal in that whatsoever. I was changing the topic to bring it back to the thread. "Cretin" however is certainly a personal attack.

That you took it as an insult shows you must be really wedded to your theses. That's a horrible quality in an investor. Got to burn that out of yourself. Being rational is all that matters, and that involves changing your mind.
Yeah never known TS to be a cretin
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